When it comes to participating in prize drawings, it’s no surprise that many of us have rarely won anything of value. Many contests are exciting to enter, with very few of us ever being selected as winners.
Thanks to the notion of composability, new web 3 opportunities have emerged to allow users to continually enter prize drawings with little to no downside.
PoolTogether is the world’s first no-loss savings game. The application allows users to pool their Dai with other players to accrue interest via DeFi’s various saving opportunities. The interest earned on the capital pool is collected into a common pool and distributed as a prize to one winner each week.
For every 1 Dai deposited a player gets 1 ticket. The average prize is currently sitting around $150 with the capital pool growing daily.
What’s even more interesting is that out of the $233k currently in the pool, roughly 65% of the Dai is “sponsored” – meaning that those tickets can not be chosen as a winner. As a result, the remaining 35% of eligible Dai is competing for 100% of the pool’s interest!
Why Should I Care?
For those of us who have been keeping up with DeFi lending opportunities, it’s common knowledge that you can easily earn 6% APR (at the time of writing) by leveraging the Dai Savings Rate.
While this rate is definitely nothing to be upset with, PoolTogether offers a way to earn substantially more interest even through minimal participation.
While you may be missing out on the opportunity cost of 6% APR, the excitement of being entered into a raffle each week can quickly make up for it!
To provide some more granularity, if you were to lock 1000 DAI via the DSR today, it would take roughly three years to earn the same amount that you *could* earn in the first week’s drawing.
Here’s a look at how the prizes have stacked up in the past.
I don’t want to lose money!
As we mentioned at the beginning, PoolTogether is a no-loss savings game. This means you can enter and exit the pool whenever you’d like! Tickets rollover after each drawing, meaning that there is no need to actively manage your holdings on a weekly basis.
Better yet, the advent of smart contracts makes the process permissionless and non-custodial, meaning that there is no risk of someone running off with your funds. PoolTogether’s contracts have undergone a suite of audits that can be found here.
What to Expect
To round out 2019, PoolTogether upgraded their pool’s base currency from Sai to Dai, marking the integration of the Dai Savings Rate. With the integration of a Uniswap-based front-end, PoolTogether has designed an intuitive and compelling way for users to pool Dai in a novel fashion.
Moving into 2020, players can expect a number of updates including:
- USDC-based pools
- “Pods” which enable users to share their tickets and split a prize pro-rata
- Additional wallet support
When it comes to DeFi composability, PoolTogether is the perfect example of a project pushing the envelope for community-oriented prizes in a user-friendly manner.
As PoolTogether continues to grow, we wish you the best of luck in winning a truly next-generation raffle!
Cooper is focused on building compelling blockchain products. He currently works as the managing director at Fitzner Blockchain Consulting and is a contributor to DAOs like MetaCartel and Moloch. He is an active member of the Ethereum community and has a strong interest in for-profit businesses such as The Block Crypto and Messari.